“Today's inflation figures show that the Bank of England cannot be complacent. I would warn against another damaging bout of quantitative easing which by the Bank of England’s own estimates has already pushed up UK inflation.

“While inflation remains above the 2% target, further monetary stimulus could well weaken consumption as high inflation damages consumer confidence. Given that the Bank of England’s inflation forecast have consistently proved far too optimistic surely it would be prudent to wait before taking any more monetary measures. With the US drought and middle east tension keeping food and oil prices rising, it is clear that inflation pressures remain strong.

“Inflation on both the RPI and CPI measures remains higher for over 50s compared with the UK as a whole according to our Saga Price Indices*, compiled by research house Cebr. Indeed, the cost of living in July 2012, compared with September 2007 – when Northern Rock failed – has risen substantially more for the over-50s than the overall population.”

Compared with September 2007, the cost of living has risen for different age bands as follows:o 50-64: 19.1%o 65-74: 22.4%o 75 and over: 22.2%o Whole population (RPI): 16.4%

Dr Altmann continues: “While younger age groups benefited greatly from falling mortgage interest payments as the Bank of England cut interest rates during the recession, older age groups in general failed to benefit from this as they have less mortgage debt and have spent more of their money on utilities that have increased sharply in price.”

Given that expenditure patterns vary across households, experienced inflation rates will differ across age-bands, the annual consumer price index (CPI) inflation was as follows for the over 50 age bands in July 2012:o 50-64: 2.6% o 65-74: 2.7% o 75 and over: 3.0%

The Saga Price Indices also show that annual retail price index (RPI) inflation was as follows for the over 50 age bands in July 2012:o 50-64: 3.3% o 65-74: 3.4% o 75 and over: 3.7 %